Minnesota’s Economic News — W/E 5/20/22
State and local taxes and spending KEYC: Agency error means richest Minnesotans owe more in taxes Star Tribune: State error means wealthy Minnesotans owe more taxes KELO: Minnesota’s costly mistake…
In late June, the American Enterprise Institute released a study by three scholars which found “more than one-in-two black men (57%) have made it into the middle class or higher as adults, up from 38% in 1960, according to a new analysis of Census data.” The researchers, W. Bradford Wilcox of the University of Virginia, Wendy R. Wang of the Institute for Family Studies, and Ronald B. Mincy of Columbia University, also found that the “share of black men who are poor has fallen from 41% in 1960 to 18 percent in 2016.”
Surprisingly, this good news generated only one comment on an AEI blog. Unsurprisingly, the lone blogger described what Professor Wilcox had to say about the results as “Pure, unadulterated horse feathers!”
About two weeks later in early July, the White House Council of Economic Advisers released a report that said, “Based on historical standards of material well-being and the terms of the engagement, our War on Poverty is largely over and a success.” To which, I’m guessing, most critics chose words other than “feathers.”
There are plenty of points to make about both studies, as well as on how they’ve been received, but let me make just a few starting with the report about black men.
The three authors note that higher education and fulltime work are “engines of success for black men in America.” No surprise here. They likewise write of how the military, black churches, and marriage also play significant roles as engines of success. Again, no surprise. But then they correctly note how the military, black churches, and marriage “tend to get less attention in our current discussions of race.” No surprise once more, though this time unfortunately so.
A few quick numbers from the study, “Black Men Making It in America.”
[B]lack men who served in the military are more likely than those who did not to be in the middle class when they reach mid-life (54% to 45%) according to our new analysis of the National Longitudinal Survey of Youth (NLSY79). Black men who frequently attended church services at a young age are also more likely to reach the middle class or higher when they are in their fifties: 53% of those men who attended church as young men made it, compared to 43% who did not.
Of these results, one might say they’re important but not overwhelming. Fine, I won’t argue, at least for now. But then there’s marriage. “Finally,” Wilcox, Wang, and Mincy write: “about 70% of married black men are in the middle class, compared to only 20% of never-married black men and 44% of divorced black men.” Yes, I know about selection effects, how correlation isn’t causation, and other statistical complexities. But when married black men are more than three times more likely to be middle class than black men who have never married, complexities aren’t all that complex.
As for the White House report claiming that the “War on Poverty is largely over and a success,” a large reason why so many people view almost all claims of success in reducing poverty as mean-spirited fraudulence is that the “official” poverty rate does not take many non-cash benefits into account, and if people on the left dwell on any single statistic, it’s this one. (Even though the official poverty rate is lower than it used to be.)
A fuller picture looks like this: A family that receives, say, $20,000 a year in cash benefits might also receive a substantial array of non-cash benefits that enables them to live better – or, one might say, feasibly. Non-cash benefits include the Supplemental Nutrition Assistance Program (previously known as food stamps); the Women, Infants, and Children program (WIC); housing allowances, energy allowances; child care allowances; and various medical benefits. And while Earned Income Tax Credits (EITC) are a cash program in a very real sense, it’s similarly not included in poverty rate calculations. This is the case, according to two additional scholars, Bruce D. Meyer of the University of Chicago, and James X. Sullivan of the University of Notre Dame, writing in the Wall Street Journal earlier this week, even though EITC “allocated $65 billion to low-income workers last year.”
Critics, nevertheless, are not inclined to adequately acknowledge benefits like these when calculating their own views about whether we have made very real, which is not to say bumper progress in reducing poverty since 1965.
But we have.